DALLAS--(BUSINESS WIRE)--Aug. 5, 2014--
Southcross Energy LLC, the former owner of the general partner of
Southcross Energy Partners, L.P. (NYSE:SXE) (“Southcross”), today
announced the completion of the previously announced agreement to
combine with TexStar Midstream Services, LP (“TexStar”), a privately
held gas gathering and processing partnership located in the Eagle Ford
shale region of South Texas. With the completion of the transaction, a
new company, Southcross Holdings LP (“Holdings”), now owns 100% of the
general partner of Southcross, limited partner interests in Southcross
and certain former TexStar assets. EIG Global Energy Partners,
Charlesbank Capital Partners and Tailwater Capital each indirectly own
approximately one-third of Holdings.

As part of the overall transaction, Southcross has acquired rich gas
system assets formerly owned by TexStar for consideration of $80 million
in cash, the assumption of $100 million of debt (which was immediately
repaid by Southcross’ new term loan facility) and 14,633,000
newly-issued payment-in-kind (“PIK”) Class B Southcross convertible
units. The rich gas system assets consist of a 300 MMcf/d gas processing
facility and over 230 miles of rich gas and residue gas pipelines. The
acquisition of the rich gas system assets by Southcross creates a
substantial Eagle Ford-focused midstream operation with four gas
processing plants, two fractionation facilities and approximately 3,000
miles of pipelines.

Holdings owns the Lancaster Gathering System and the NGL System, both
originally part of TexStar, as well as an approximate 57% limited
partner interest in Southcross and 100% of Southcross’ general partner,
which owns a 2% general partner interest in Southcross and Southcross’
incentive distribution rights. Public unitholders own the remaining 43%
limited partner interest in Southcross. Assets retained at Holdings are
expected to be available as future drop-downs into Southcross. Holdings
has no obligation to sell its assets to Southcross and Southcross has no
obligation to buy such assets.

“We are excited to announce the completion of the transactions and our
improved platform for growth,” said David Biegler, Chairman and Chief
Executive Officer of Southcross’ general partner. “The response from our
customers has been enthusiastic and we are already beginning to see
increased business opportunities. We believe that this commercial
momentum, combined with our increased scale and focus in the Eagle Ford,
integrated system to Corpus Christi markets, strong financial backing
and enhanced operational stability position us well for growth over the
near and long-term.”

Financing Information

In conjunction with the transaction, Southcross has entered into a new
seven-year $450 million Term Loan B facility and five-year $200 million
revolving credit facility. The proceeds from the term loan were used to
fund Southcross’ purchase of the rich gas system assets (including the
repayment of the $100 million of debt assumed in the transaction), repay
outstanding amounts under Southcross’ existing revolving credit facility
and pay transaction related fees and expenses.

About Southcross Energy Partners, L.P.

Southcross Energy Partners, L.P. is a master limited partnership that
provides natural gas gathering, processing, treating, compression and
transportation services and NGL fractionation and transportation
services. It also sources, purchases, transports and sells natural gas
and NGLs. Its assets are located in South Texas, Mississippi and Alabama
and include four gas processing plants, two fractionation plants and
approximately 3,000 miles of pipeline. The South Texas assets are
located in or near the Eagle Ford shale region. Southcross is
headquartered in Dallas, Texas. Visit www.southcrossenergy.com
for more information.

Forward-Looking Statements

This press release includes certain statements concerning expectations
for the future that are forward-looking within the meaning of the
federal securities laws. Forward-looking statements include, without
limitation, any statement that may project, indicate or imply future
results, events, performance or achievements, and may contain the words
“expect,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “will
be,” “will continue,” “will likely result,” and similar expressions, or
future conditional verbs such as “may,” “will,” “should,” “would” and
“could.” Without limiting the generality of the foregoing,
forward-looking statements contained in this news release specifically
include the expectations, plans, strategies, objectives and growth of
Southcross and its subsidiaries, including the potential for future
drop-down transactions and anticipated synergies from the acquisition of
the rich gas system assets. Although Southcross believes the
expectations and forecasts reflected in these and other forward-looking
statements are reasonable, Southcross can give no assurance they will
prove to be correct. Forward-looking statements contain known and
unknown risks and uncertainties (many of which are difficult to predict
and beyond management’s control) that may cause Southcross’ actual
results in future periods to differ materially from anticipated or
projected results. An extensive list of specific material risks and
uncertainties affecting Southcross is contained in its Annual Report on
Form 10-K filed with the Securities and Exchange Commission (the “SEC”)
on March 5, 2014 and in other documents and reports filed from time to
time with the SEC. Any forward-looking statements in this press release
are made as of the date hereof and Southcross undertakes no obligation
to update or revise any forward-looking statements to reflect new
information or events.